Wise wants to tax 'grey' machines

January 18, 2001

Wise wants to tax 'grey' machines

By BOB PARTLOW / Staff Writer, Martinsburg

SHEPHERDSTOWN, W.Va. - West Virginia Gov. Bob Wise said Wednesday he either wants to tax the so-called "gray machines" in the state and restrict the number allowed or enforce the law against using them for gambling.

"We should either regulate them, reduce them and restrict them and tax them or we're going to take them out," he said during a press conference at Shepherd College.

Wise said his first choice would be to restrict and tax the machines and he will propose legislation to do that.

If that doesn't get them under control, "we'll start enforcing the law and more of the machines will be confiscated," he said.

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His remarks came as Pikeside businessman Brian Frazee waits to hear from the state Alcohol Beverage Control Administration about what penalty he might face following removal of some of his machines from Woody's Market by the ABCA in December.

"We'll be sending out a letter probably next week telling him what the fines will be," said Deputy Commissioner Keith Wagner.

Wagner said the state confiscated 10 machines in the two raids, although Frazee said they took two the first time and four the second.

"I've taken them all out until they legalize it," Frazee said of the eight machines he had in his store.

The machines are electronic slot machines that are legal for businesses to own and people to play. They become illegal when those who win at the machines receive payouts. Because they are legal unless a payout is involved and because the law against them has been selectively enforced over the years, they have received the name "gray machines."

The state estimates about 10,000 such machines are in operation in West Virginia.

In August, Frazee was being interviewed by a Herald-Mail reporter when he paid a customer who had been playing the machines. On the record he admitted the payout, acknowledged it was illegal and said "if a state official came around, I'd pay them."

Wagner said the story played a role in what happened to Frazee.

"It did sort of turn the light on," Wagner said. "It did raise a flag."

Frazee said his wasn't the only business that was targeted. Wagner said other businesses also had machines removed, but he did not have their names.

Considering how things turned out, Frazee said it might not have been the best move to acknowledge his activity publicly.

But, he said, "If they do this to me, they should do it to everybody. They know it's going on. They act like they don't, but ..."

Wagner said the agency has a limited number of people to enforce the law, so those who are the most visible are the ones who get their attention.

"When things get blatant, or when we get calls or complaints, we go in with the undercover agents," he said.

Several bills related to gray machines were introduced in the West Virginia Legislature in 2000. The measures proposed a variety of solutions such as regulation and taxation or elimination.

State Del. John Overington, R-Berkeley, said he and 28 other legislators have written the governor on the subject.